Slashing $39B in food aid could cost states

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Washington • The bill the House passed last week to slash $39 billion in food aid was all about reducing the scope of the federal government, but it could do the opposite for states.

The Republican bill eliminates a shortcut states have long used to determine eligibility for food aid provided under the Supplemental Nutrition Assistance Program (SNAP). Without the shortcut, states will have to conduct more determination tests, probably forcing an expansion in state bureaucracy and adding administrative costs.

Rather than check whether each household qualifies for SNAP benefits directly, states have for years been making that determination based on whether the household has received other low-income assistance.

The thinking for the practice, known as "categorical eligibility," was this: If you've already passed the test for welfare, you probably pass it for food stamps.

"Categorical eligibility was seen as advancing the goals of simplifying administration, easing entry to the program for eligible households, emphasizing coordination among low-income assistance programs, and reducing the potential for errors in establishing eligibility for benefits," Congress's research arm, the Congressional Research Service (CRS), wrote in a report about the practice last week. Forty states - red ones and blue ones - have embraced the broadest form of categorical eligibility, it found.

Under the Republican House bill, that shortcut would be restricted, yielding $11 billion in savings over a decade as households are discouraged or deemed ineligible for the benefits. An estimated 2.1 million people would lose benefits next year, according to the nonpartisan Congressional Budget Office. But while the federal government's payouts will shrink, cash-strapped states will have to administer more determination tests.

"This limitation in categorical eligibility would increase state administrative costs in SNAP and significantly curtail state flexibility," the nonpartisan National Conference of State Legislatures wrote in a May letter responding to a similar provision.

This month, the American Public Human Services Association (APHSA), a group whose membership includes SNAP administrators, echoed the sentiment. States have become more efficient in determining eligibility under the current SNAP rules, APHSA wrote in a letter to House and Senate leadership.

Conservatives argue that restricting the practice prevents those who don't qualify for food aid from receiving it. And it is true that some are determined eligible when they are not. In many states, the practice eliminates the asset test (SNAP recipients must have less than $2,000 in liquid assets). And CRS found that some households were found to be eligible even though they earned more than the rules allow.

In fiscal 2011, for example, a monthly average of 3.5 percent of households without an elderly or disabled member received SNAP benefits and had incomes above the cutoff of 130 percent of the poverty line, according to CRS.

But advocates argue that by adding another eligibility test, those who deserve and need SNAP benefits may be turned away.

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